Evergrande Shares Tank as Trading Resumes after 17 Months

Shares of China Evergrande Group, the world's most debt-laden property developer, tumbled a staggering 87% upon opening on Monday, marking its first trades since March 21, 2022.

Monday saw the stock drop to a paltry 22 Hong Kong cents, a steep drop from its previous close of 1.65 Hong Kong dollars on March 18, 2022.

This dramatic plunge coincided with Evergrande's disclosure of a 39.25 billion yuan ($5.38 billion) loss for the first half of the year. However, this was notably less than the 86.17 billion yuan loss reported over the same timeframe in the previous year.

In July, the embattled firm sought Chapter 15 bankruptcy protection in a U.S. court. This move was aimed at shielding its stateside assets from creditors as it pursued a restructuring strategy abroad.

Evergrande defaulted in 2021 and announced an offshore debt restructuring program in March, having struggled to finish projects and repay suppliers and lenders.

Earlier this year, the company posted a combined loss of 582 billion yuan in its long overdue earnings report.

Net losses for 2021 and 2022 were 476 billion yuan and 105.9 billion yuan, respectively, as a result of writedowns of properties, return of lands, losses on financial assets and financing costs, the company said.

In 2020, before the company went into default, Evergrande posted a net profit of 8.1 billion yuan. China’s wobbly real estate sector has offered cause for concern for market watchers afraid that the country’s economic struggles could spread to other parts of the world.